Latest unemployed: Stimulus-subsidized workers

By Tami Luhby, senior writer


NEW YORK (CNNMoney.com) -- Tens of thousands of low-income workers lost their jobs Thursday as a stimulus-subsidized employment program came to an end.

About a quarter of a million people in 37 states were placed in short-term jobs thanks to a $5 billion boost to the Temporary Assistance for Needy Families program, according to the Center on Budget and Policy Priorities. States used about $1 billion to provide subsidized employment, with the remaining funds going to cash grants, food programs, housing assistance and other aid.

About half the jobs were summer employment for youth and the rest were for disadvantaged parents. Each state configured its initiative differently. Some covered all the workers' wages for a few months, while others paid for a portion of their salary.

With the program expiring, many of the adults have been told not to report to work anymore. And it won't be easy for them to find a new position at time when the unemployment rate continues to hover at 9.6%

"They are just joining the millions of other people looking for permanent work," said Elizabeth Lower-Basch, senior policy analyst at the Center for Law and Social Policy, an advocacy group known as CLASP.

The TANF jobs initiative was one of several stimulus initiatives that ended Thursday. Also running out are a $2 billion subsidized child care program and a $2.1 billion boost for Head Start, an early learning program for needy children.

Limping along

State officials and advocacy groups have been lobbying Congress to extend the jobs program and other Recovery Act measures, but federal lawmakers have shown little appetite to do so.

A handful of states will continue to operate the programs for another few months, but most of those will be downsized considerably.

Illinois announced earlier this week that it will continue the program with state funds for up to two months in hopes that Congress will provide more money for it. The state has placed more than 26,000 workers at more than 5,000 private, non-profit and government employers.

"The best way to make our economy stronger is to put people to work," said Gov. Pat Quinn. "It is good for families, small business owners and businesses."

The TANF jobs program is among the few stimulus initiatives that have been embraced by Republican governors. Mississippi's Haley Barbour, who headed the Republican National Committee in the mid-1990s, praised the effort.

The "program will provide much-needed aid during this recession by enabling businesses to hire new workers, thus enhancing the economic engines of our local communities," Barbour said when the initiative launched last year.

South Carolina, Texas and Minnesota -- all headed by Republican governors -- plan to continue their programs either in a smaller form or for a few months, according to the Center on Budget and Policy Priorities. To top of page

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